The operator sets out its view for “An Industrial 5G Spectrum Policy for Europe” in a position paper, arguing that ‘set-aside’ policies will lead to significant consumer welfare loss.
Background: Mobile operators are investing heavily in spectrum for 5G, as regulators award the frequencies to ensure 5G is commercially available in Europe by 2020. Vodafone has so far invested about €5bn in spectrum across seven EU countries, rolling out services to 100 cities. This week, the operator published a position paper in which it voiced its concern of an ongoing regulatory discussion on whether internationally harmonised cellular spectrum should be ‘set aside’ for private localised use instead of being auctioned.
A potential loss in consumer benefit: In the paper, Vodafone argues that set-aside policies result in less spectrum remaining available for deployment in national networks, giving marginal potential benefits to a narrow set of stakeholders at the expense of all other 5G users, society, and the wider economy. They argue this will lead to a significant consumer welfare loss, reducing the incentive for investment by distorting competition, inflating the costs of spectrum licences and limiting the ability of operators to build 5G networks in the most effective way.
What should regulators do? Vodafone argues that regulators considering setting spectrum aside for local use should be required to justify policies that move away from established market-based solutions, particularly as national operators are already delivering innovative 5G and 5G-ready connectivity to a range of industrial partners across the continent. Vodafone thinks there is insufficient evidence of market failure that justifies a departure from market-based award mechanisms, and notes there are alternative policy options worth pursuing, such as spectrum leasing or making available non-mobile spectrum on a shared basis.
